(Reuters) - Canadian gold miner Iamgold (IMG.TO) on Monday outlined promising drill results from exploration near its existing mines in Burkina Faso and Suriname and from a rare earth zone at its niobium mine in Quebec.
Toronto-based Iamgold said drilling at the Gossey-Korizena trend near its Essakane mine in Burkina Faso in West Africa has shown “excellent promise” and it encountered significant mineralized intersections at its Koemboe prospect, near its Rosebel mine in Suriname in South America.
Its shares rose 2.5 percent to C$22.13 on Monday on the Toronto Stock Exchange.
Iamgold is spending some $97 million on exploration this year, as it looks to boost gold output. Based on current projects, the company put 2013 production at some 1.1 to 1.2 million ounces, up from 870,000 to 930,000 ounces this year.
Iamgold said it working on more than 18 grassroots projects in Senegal, Mali, Suriname, Colombia, Peru, Brazil and Canada and expects to complete over 500,000 meters of exploration drilling this year.
The company also said a drill program to define a rare earth zone at its Niobec niobium mine in Quebec was moving forward, with 7,000 meters of a planned 8,500 meters of drilling completed.
Rare earths are a group of 17 metals used in technology items like smartphones and hybrid cars.
In recent years China, which produces some 95 percent of the world’s supply, has repeatedly clamped down on export quotas, sending prices soaring and prompting a push to develop new rare earth deposits around the world.
The drilling program will provide a preliminary grade estimate for the deposit. Early testing showed rare earth recovery rates between 58 and 70 percent, the company said.
Iamgold said it will continue to test the drill samples to see if the deposit can be mined and processed in an economic fashion.
In May, Iamgold chief executive Steve Letwin told Reuters the company could spin Niobec out into a separate company. Iamgold produces about 8 percent of the world’s supply of niobium, which is used to harden to steel.
Reporting by Euan Rocha and Julie Gordon; editing by Janet Guttsman